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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

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IN THS ISSUE Page 2 Executive Perspective with Tom Richards Page 4 Viewpoint by Marty Wolf Page 6 Value Lies in the Eye of the Beholder Page 8 Five Key M&A Trends in Cloud Computing and IaaS Page 10 China’s Dragon Snuffed Out by Cloud Page 13 Maximizing Your Place on the Valuation Continuum Page 14 SaaS — How Long Can This Last? Page 17 Taking the Right Steps to Creating Value Page 20 Notes from a Dialogue on Cross-Border M&A Page 23 Selected Transactions Page 25 Select martinwolf Transactions Page 26 Appendix

Transaction Highlights Transactions shaping the IT mergers and acquisitions space

IT Services August 27, 2012 IBM (NYSE:IBM) announced that it would acquire Kenexa Corp. (NYSE:KNXA) in a deal worth $46 per share, for a total of $1.26 billion, representing a significant move by IBM into the Human Capital Management space that follows SAP’s 2011 purchase of SuccessFactors, Inc. and Oracle’s 2012 purchase of Taleo. September 10, 2012 Infosys Ltd. (BSE:500209) entered into a definitive agreement to acquire Lodestone Management Consultants AG, which provides IT consulting services to financial, pharmaceutical and consumer goods enterprises with an implied enterprise value of $349 million. SaaS August 27, 2012 Thoma Bravo Fund IX L.P., a fund of Thoma Bravo, LLC signed a definitive agreement to acquire Deltek Inc. (NasdaqGS:PROJ), an enterprise software and information solutions provider for $890 million, approximately $13 per share. September 19, 2012 Lenovo Group Limited (SEHK:992) has signed an agreement to acquire Stoneware Inc., a developer of cloud computing solutions through web technologies for an undisclosed amount.

! October 4, 2012 Cisco Systems, Inc. (NasdaqGS:CSCO) completed its acquisition of vCider, Inc., a virtual cloud networking service for an undisclosed amount.

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IT Supply Chain Services September 4, 2012 Tech Data Europe GmbH, a leading PC hardware distributor, has acquired Specialist Distribution Group (SDG) Ltd., a distributor of technology products and solutions, for $350 million August 9, 2012 HCL Insys Pte. Ltd., a leading provider of IT and related activities acquired NTS Fz LLC, a distributor of IT hardware and software solutions, for an undisclosed amount.!

______________________________ Executive Perspective:

Tom Richards President and CEO, CDW Editor’s Note: In an effort to provide a C-Level perspective on ongoing trends in the IT space, and how they affect business, martinwolf interviews an executive each quarter from a leading firm in this space. Today we include Tom Richards, president and CEO of CDW, who provided his thoughts on the cross-border M&A, the importance of the cloud and other relevant topics.

MW: What do you think are the three biggest trends affecting the IT business today? TR: Today’s IT environment is more dynamic than ever; new technologies and products are being introduced and rapidly deployed into our customers’ strategies. The top three trends our customers are engaging us on are mobility, cloud and big data because they believe these technologies — when strategically combined — can deliver a competitive advantage. That being said, there continues to be heavy investment in virtualization and unified communications. Most importantly, our customers continue to prioritize, invest and align their IT strategies with their business strategies and CDW is privileged to be part of that process. MW: Talk through your cross-border M&A Strategy TR: We believe we have 5 percent of a $200 billion market in the US and Canada. There’s plenty of opportunity to drive growth in North America. However, we’re always evaluating our strategy and looking for incremental opportunities for scale. Still, our focus is on executing our core strategy.

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MW: How does the cloud alter your go-to market strategy? TR: It enhances our strategy to be the leading IT solutions provider in the markets we serve. One of our core goals is to continue to expand our solutions suite, which includes providing cloud computing expertise and capabilities. CDW recently announced a new partnership with salesforce.com that will diversify our cloud offerings. Through this partnership, we are able to provide both CDW and CDWG customers with cost effective cloud solutions, as well as social, mobile and open capabilities of salesforce.com's cloud technologies. In addition, our managed services capabilities are a differentiator for CDW. Whether it’s public, private or hybrid cloud, CDW’s size and technical resources help companies implement and integrate cloud solutions. MW: Where does mobile fit into your long-term strategy? TR: Mobility presents huge opportunities for CDW customers because of its ability to deliver speed and responsiveness to improve their customer experience. We know that people want to use the same technology at work as they use at home, and IT organizations are becoming more comfortable managing BYOD environments because we can provide them with the critical tools to manage the network, risk, privacy and compliance that come along with consumer-based technologies. But, to me, the more exciting aspects of mobile technology are happening with business applications, especially in the areas of CRM, warranty management and service organizations. These applications are profoundly improving the way our customers serve their customers by providing them with the technologies, tools and capabilities to make it happen. MW: What are your thoughts on Social Media (both for customer communications and business strategies)? TR: There are conversations happening every day that shape brands and influence customer opinions, so we think social media plays an important role in both. For CDW, the customer has always been at the center of everything we do, so being able to engage with them in a compelling way via social media has helped us not only improve how we work as an organization, but also build a community of advocates for the brand. MW: Do you tweet or utilize any Social Media tools? BE: CDW continually adopts new strategies in the social space to engage customers, coworkers and the public. Social media has been a great driver of our brand messages. For me personally, I still value 3


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face-to-face conversations and believe one-to-one relationships are equally important in how a customer feels about you and your company. MW: Do you find yourself working more or less as the digital age progresses? TR: Probably the same. For most people, it’s not always about if we are working more or less but how we work that changes. Technology certainly enables people to be more connected, which can therefore increase productivity and overall efficiency in an organization. It doesn’t mean you have to work 24/7.

______________________________ Viewpoint:

Winds of Change By Marty Wolf Founder, President

In early October, I was the keynote speaker at a conference on crossborder M&A organized by martinwolf and three other major players in the M&A world in India: Grant Thornton India, HSBC, and Khaitan & Co. The event, presented by the Bangalore Chamber of Industry and Commerce, was remarkable not just for what was said (though as Managing Director of our India practice group Gaurav Sharma, explains on page 20 it provided novel insight on the Indian M&A scene). It was also notable because it demonstrated how the focus of our India initiative has shifted since we established our Bangalore office early this year. When we decided to establish a physical presence marketing India, we expected to be primarily advising large Indian companies interested in purchasing U.S. assets. But our focus has evolved with the rapidly changing landscape, driven by several factors: • The weakening rupee, which has depreciated by nearly 25 percent against the U.S. dollar since August 2010 — an alltime high this past June — drives up domestic business expenses and the cost of overseas acquisition. • Slowing GDP growth in India, which has been steadily declining since the fall of 2010 and is on the path for a 10-year low after achieving only 5.3 percent growth in Q1 2012.

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The drastic decline in the number of Indian IPOs, which has fallen from a high of 61 in 2010 to just 10 so far in 2012 (as of September 25th).

The current situation is the opposite of what we and many other observers had expected: the small, very technical companies with global footprints are in India, while in many cases the private equity investor or the strategic partner interested in buying is in the United States. Now, this does not mean that big companies are completely absent from the India M&A scene — there are still large companies doing sizeable acquisitions on a continuous basis. Regardless of size, though, a new trend is emerging: a shift toward cloud computing. This shift is not just limited to India. We’re experiencing it in our own client base — 30 percent of our companies are cloud services companies. And that doesn’t count all of the traditional Professional Services companies that are rebranding themselves Managed Services providers or the integrators that are now referring to themselves as cloud providers — I’m talking about real cloud-related services. The growing interest in this space is a meaningful change. And it’s not just the big guys like Oracle, IBM and SAP making big strategic investments in niche SaaS companies — there’s a lot of activity and consolidation going on in in the mid-market where we play. Buyers aren’t limited to the usual suspects, either. We’ve run several auctions in the cloud/managed-services space and the companies that have indicated interest are often unfamiliar names. In the coming year we also expect to see increased activity by PE firms both in the cloud and in M&A as a whole. I read a very interesting report recently in the Wall Street Journal about how private equity funds generally have a very narrow window (typically five to seven years) in which to spend their money or return it — and that period is almost up for the funds that were initialized in the peak years of 2007 and 2008. These funds still have $38.9 billion and $57.6 billion remaining, respectively, and I expect that a fair portion of it will end up in the cloud. Now, you can talk about diligence and fiduciary responsibility until you are blue in the face, but given the choice, PE firms would rather invest the money they have from investors (albeit at a potentially lower return) instead of giving it back. In fact, we are already seeing very aggressive moves by PE firms on a global scale. On a less rosy note, it’s important to remember that even with all this attention being given to M&A (cross-border and otherwise), getting 5


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these deals finished remains difficult for companies of all sizes. There have been several firms in our space that, for reasons of financing, price fit, or some other reason, have been unsuccessful. Our own experience has been that finding the right buyer and understanding current market trends have never been more important. I want to close by returning to something I first brought up in the last issue of VDI: the uncertainty of the current political situation and how it continues to affect the M&A space. Regardless of who wins the upcoming presidential election in the United States, whether destabilization will improve or worsen depends on what they actually do once in office — not what they are saying on the campaign trail. But one thing is clear: if next year the maximum tax on long-term capital gains increases to 25 percent (rather than the current 15 percent) and short-term capital gains are taxed at a maximum of 40 percent plus (rather than the current 15 percent), that will have unintended negative consequences overall on capital markets. And that will affect all of our businesses for the worse.

______________________________ Value Lies in the Eyes of the Beholder By Yousif Abdura Senior Analyst

One of the first questions many owners of companies ask when deciding whether to sell is “What is my company worth?” Valuation ranges can be established using revenue or EBITDA multiples based on valuations of comparable public companies, precedent transactions, and, in certain cases, discounted cash flow analysis. These tools give general valuation ranges in which a company can be expected to trade. However, the complete answer to the question has more to do with what a buyer is willing to pay, which is driven by either: a) a greater need for the asset, or b) being able to do more with the asset than the current owner or a competing buyer. For example, we are currently engaged as the sell-side advisor for a number of mid-market cloud-related companies. What we are seeing today is that these companies are far more valuable to prospective buyers (both strategic and financial) than they are to themselves. These companies have established solid businesses with recurring revenue, growing client bases, systematized processes and procedures and scalable infrastructures. They are prime acquisition targets due to the strength of their businesses, but their valuation will be driven primarily by what the prospective buyers believe they can

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do by acquiring the asset. The examples below refer to instances where prospective buyers have seen the ability to capitalize on opportunities that would not have been feasible under current ownership: Accelerating Geographic Expansion / Increasing Market Share A common theme among prospective buyers in the cloud space has been to acquire in adjacent markets to take advantage of consolidation of data center space and resources. These buyers are also able to benefit from knowledge of regional markets, removing a future competitor and establishing themselves as significant regional players. Although cloud computing by its nature is about remote access, in the mid-market space customers are acquired through a traditional sales and marketing model, which is overwhelmingly local. Selling to a Vast Customer Base Value can be driven to high levels when a buyer is able to immediately take a company’s cloud services to its existing customers. In a recent example, a prospective buyer had 15,000+ customers who could be offered the cloud. Due to the scalability that the seller had already built into its business, this would have given it access to a potential customer base that was more than 100 times its existing base. In an example like this, the prospective buyer can justify paying significantly more than standard valuation methodologies would suggest that a company is “worth.” Enabling Business Transition In some instances, companies are looking to provide new, higher value and more profitable services than they currently provide. This is particularly true for companies in adjacent spaces that have industry knowledge and a significant customer base, but lack the in-house ability to develop a cloud-based service offering in a reasonable amount of time. Service providers in adjacent spaces have used M&A to move into cloud computing services in order to gain presence in the marketplace. For example, services providers from telecom (for example, TDS’ acquisition of One Neck or CenturyLink’s acquisition of Savvis), value-added resellers (for example, Best Buy’s acquisition of mindShift) and international buyers (NTT’s acquisition of Dimension Data) have all used M&A to build their cloud services offerings. To capture the most value in the sale of part or all of your business, it is helpful to know what buyers are looking for, but it is crucial to understand each buyer’s pain points and strategic goals. The highest valuations and the most compelling offers come from buyers that have specific and pressing reasons to acquire a business. Based on these axioms, a number of our cloud services companies are finding they 7


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are significantly more valuable to prospective buyers than they realized.

______________________________ Five Key M&A Trends in Cloud Computing and IaaS By Sunil Grover Executive Vice President

In the last edition of Valuation and Deal Insights, we defined the $100 billion+ cloud computing marketplace. We also talked about how various vendors groups — for example, Managed Services providers, Infrastructure as a Service (IaaS) providers, solution providers (traditionally referred to as value-added resellers or VARs) and technology companies — were approaching the opportunity. And we highlighted cross-border M&A opportunities in remote infrastructure Managed Services. We presently have four active engagements in the cloud computing/IaaS space. Based on this experience we see the following five key trends driving M&A in the coming months and quarters: 1. Private equity (PE) is extremely active in recapitalizing companies and driving subsequent acquisitions. The value proposition of IaaS is converting customers’ capital expenses in infrastructure to operating expenses in IaaS. PE professionals appreciate the significance of this value proposition. They are also attracted to the recurring revenue and deep customer engagement inherent in these businesses. Marketplace adoption of IaaS is growing rapidly and the marketplace is highly fragmented, presenting numerous opportunities for growth through selective acquisitions. Private equity recapitalizations in the recent years included GoDaddy, Endurance, Peak 10, Digital Fortress, Softlayer and Datapipe. These companies and several others have all done selective follow-up acquisitions to grow, as summarized in the table below. 2. Telcos are entering the IaaS market. Telecom companies provide the backbone connectivity to data centers. To move up the value chain and monetize their existing 8


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customer base, several have acquired IaaS providers. Sizeable examples include Verizon’s acquisition of Terramark, Time Warner Cable’s acquisition of Navisite and Windstream and a telco provider for rural locations acquiring Hosted Solutions. Similarly, TDS’s acquisition of One Neck now allows it to offer cloud-computing services to its customers. 3. Public companies are driving strategic transactions. With access to public capital markets and previously established meaningful bases, publicly traded IaaS providers are pursuing strategic transactions that can meaningfully improve their value proposition. Web.com’s acquisition of Network Solutions, for example, was unique in that at the buyer acquired a company least twice its size and, as a result of the transaction, got General Atlantic, a very large private equity investor, as one of its significant shareholders. Rackspace has acquired small technology providers such as Mailgun, Anso Labs and Cloud Kick that will make its offering to enterprise clients more robust. Peer 1 and Equinix have both acquired overseas data center and hosting service providers to enter into new markets and provide their enterprise clients a global managed hosting solution. 4. Solution providers are entering the IaaS market. Value-added resellers and technology solution providers are the first point of contact when a mid-market customer is looking to investigate cloud solutions. Some of these companies have acquired IaaS capabilities. For example, Presidio acquired INX and Bluewater Communications Group to expand its IaaS offering Similarly, office supply retailers like Best Buy and Staples have entered the IaaS space, with Best Buy’s acquisitions of mindSHIFT and White Glove Technologies and Staples’s acquisition of Thrive Networks. Additionally, Konica Minolta has acquired All Covered to cross-sell remote infrastructure management services to its SMB customers, and has been growing further through targeted acquisitions 5. Hosting companies are becoming one-stop shops for mom & pop and small businesses. Hosting companies addressing the mom & pop/small business market are becoming one-stop shops for all their web-marketing needs. Most of them have been providing various SaaS applications as resellers 9


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and some have recently started acquiring the more popular application providers so they can generate more revenues from their existing customer base. For example, Web.com acquired Register.com and subsequently Network Solutions, Inc. — both domain registrar services. GoDaddy.com similarly acquired Outright, Inc., an accounting SaaS solution for small businesses. In summary, M&A activity in the cloud computing / IaaS marketplace is high. In the recent past, it has largely been driven by private equity recapitalizations and private equity-backed platforms. Some telecom companies have made sizable acquisitions and increasingly publicly traded companies are acquiring strategically important assets. We expect M&A activity in this marketplace to continue to be robust in the near future. For more information, see the list of cloud computing transaction comparables in the Appendix.

___________________________ China’s Dragon Snuffed Out by Cloud By Hao He Vice President One of the main drivers of the transformation of China into a global economic superpower over the last 30 years is this: the Chinese government knows how to get things done. That’s why it is significant that in China’s 12th Five-Year Plan (20112015) one of the seven “national emerging industries” targeted as a way to boost GDP growth was “next-generation IT,” and cloud computing especially. According to the plan, cloud computing will be a chief driver of the IT industry and the development of “e-government” in China. As background, China’s five-year plans lay out both social and economic goals for the country, and over the years the Chinese government has a pretty good track record of meeting or exceeding many of the targets in these plans. While this has become more challenging as the country has grown, China’s five-year plans remain a powerful force for rapid progress in areas China’s leaders deem

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essential to the economic prosperity of the country. Not that cloud computing in China was stagnating before the government’s plan covering emerging industries was officially released on May 30, 2012. According to research firm IDC, China accounted for around 10 percent of global cloud-computing investment in 2011 totaling $28 billion. And the rising cloud opportunity in China spawned a number of powerful partnerships over the past couple of years. In late 2010, China Mobile and Microsoft signed a deal to jointly promote the application of cloud computing technologies. In 2011, Asia’s leading independent telecommunications service provider Pacnet partnered with the Chongqing municipal government to jointly develop an international cloud computing hub. Also, Chinese telecommunications network solutions provider Huawei opened a new R&D center in Silicon Valley that focuses on cloud computing research. And China Telecom and SAP formed a strategic partnership to offer a cloud-based version of SAP’s business software suite to small and medium-sized businesses in China. Earlier this year, Intel’s investment and M&A group announced that it invested in Beijing ZZNode Technologies, a provider of telecommunications IT operations management and a major player in China’s public and private cloud infrastructure as a service management software and services market. But now that the Chinese government has specifically targeted cloud computing in its latest five-year plan, it is actively investing upwards of $150 billion in 25 cloud computing centers by 2015 to shore up the country’s relatively immature cloud computing infrastructure. So far, five cities — Beijing, Shanghai, Shenzhen, Wuxi and Hangzhou — have been designated cloud innovation pilot cities. Eight other provinces and cities have also announced cloud computing strategies and plans. Naturally, this large investment has increased interest among major global players such as Cisco, IBM, Intel and Microsoft as well as private sector companies and state-owned enterprises in China. According to IDC, if all of the plans are implemented, China will have more than 10 million cloud computing servers worth more than $220 billion. Immediate beneficiaries of an improved cloud computing infrastructure in China include three categories of domestic companies. The first is China’s three state-owned telecommunications companies, China Telecom, China Unicom and China Mobile.

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The second category is IT Services, which includes companies such as Inspur. Inspur, for example, partnered with the Qingdao municipal government in 2011 to build its first cloud computing platform for egovernment. The third category is Internet, software and ecommerce companies, including Baidu, China’s largest search firm and its subsidiary, Ali Cloud Computing, and ecommerce players Alibaba and Sina and Kingdee, which all provide cloud-based and SaaS solutions. Not surprisingly, though, activity in the cloud space in China has reached a fever pitch this year. Here are just a few of the major developments that have occurred just since the beginning of September: •

September 3: Baidu announced that it will invest more than $1.6 billion in its cloud computing center as part of its mobile strategy.

September 5: The non-profit Cloud Security Alliance signed a Memorandum of Understanding with the Hong Kong Applied Science and Technology Research Institute to advance cloud computing security and accelerate the development of the cloud ecosystem in Hong Kong.

September 6: Microsoft announced that it will add 1,000 employees in China and invest an additional 15 percent in R&D as part of a cloud push aimed at competing more effectively with Apple and Google in the world’s most populous mobile Internet market.

September 8: Alibaba reported that it expects to sell more merchandise this year than U.S.- based ecommerce giants Amazon and eBay combined.

September 18: Chinese PC-maker Lenovo said it plans to acquire Stoneware, a U.S.-based provider of cloud-based platform used to unify an organization’s IT services.

Despite the high levels of investment in cloud infrastructure and innovation — and the resulting spurt in activity — the cloud computing space in China is not entirely worry free. Three issues are: 1) China’s censorship and sweeping state secrecy laws, which cause concern about data security and privacy, especially for foreign companies unused to such restrictions. 2) China has a relatively slow average Internet connection rate. According to Akamai in its most recent State of the Internet Report for Q1 2012, China’s average Internet connection speed is just 1 mbps, which places it 93rd in a global ranking.

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For comparison purposes, Hong Kong’s average connection speed is 9.3 mbps while the U.S. average is 6.7 mbps. India’s is just 1 mbps, placing it 112th on a global ranking. (It should be noted, however, that China’s speed increased 46% year over year from Q1 2011 to Q1 2012. India’s increased just a little more than 20% in that same time period.) 3) Data center operators still face issues with power availability and therefore are not able to provide high (power) density data centers. The lack of Tier 4 data centers creates problems for some international companies, especially those in financials services, which have strict global standards. Even with these concerns, the impact of the large and focused investment in cloud computing by the Chinese government will no doubt be a rapid acceleration of the growth and development of the domestic market and of the Chinese cloud ecosystem that is growing up to support it. It will follow the same trajectory to be sure — markets naturally evolve in several stages from nascent to early growth to established and mature — but it will happen on a greatly compressed timescale. So for international companies seeking access to the large and growing Chinese domestic cloud computing market — or Chinese companies seeking to extend their cloud reach domestically or into other geographies — partnership or acquisition opportunities abound. Either way, instead of the Year of the Dragon, 2012 just might be remembered as the Year of the Cloud.

___________________________ Maximizing Your Place on the Valuation Continuum By Anthony Lembo Principal With the continuing economic malaise making growth and profitability challenging, many IT companies are rethinking their business models in the hopes of increasing their growth, profitability and valuation. One clear opportunity to do so lies in the cloud service and technologies sector. Gartner forecasts that the infrastructure as a service (IaaS) cloud market segment will grow from $4.3 billion in 2011 to $6.2 billion in 2012, and reach close to $14 billion by 2016. Gartner also expects 13


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software as a service (SaaS) and platform as a service (PaaS) cloud segments to continue growing from their current $14 billion and $1.2 billion run rates, respectively. These forecasts bode well for companies in the cloud services market. With the high growth and recurring revenue potential found in the cloud, cloud companies are currently enjoying the benefit of higher valuation multiples relative to other IT Services companies that do not have strong cloud offerings. The result is that the relationship between a firm’s ratio of products and services offerings and its valuations can be depicted on a continuum such as the one that follows this VDI. On it, we see that valuation multiples increase when a company adds services to its offerings. At one end of the spectrum is PC Connection, a leading multi-channel retailer of computers, electronics and industrial products with an enterprise value as a multiple of revenue (EV/Revenue) of .12x. At the other end is Rackspace, with its recurring data center cloud model and an EV/Revenue multiple that is a robust 7.75x. Other companies, which have product/service revenue mixes between the two extremes, fall somewhere in between. Bottom line, when companies contemplate changes to their offerings and business models, they should consider how the changes might impact their position on this valuation continuum. And the closer they can get to the cloud, the more their efforts will be rewarded in higher valuations. See the Appendix for the Valuation Continuum.

______________________________ Cloudy with a 100% Chance of Growth

SaaS — How Long Can This Last? By Tim Mueller Principal

The question most executives of successful companies ask is, “How long can this last?” Maybe it started in the days of the caveman with the invention of the wheel, which eventually became a commodity. It continues today with the computer, which has evolved beyond a commodity to a fashion statement, and, with today’s mobile devices, will perhaps even soon be obsolete.

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Personal case-in-point, I lived this “how long will it last question” in 1999 when my partner and I sold our web design and ecommerce integration company, Vantage One. We had ridden the wave of “hot” technology (at the time) to become one of the fastest growing companies in our space. Our list of Fortune 500 clients was stellar. We were ahead of the curve and had strong marketing expertise. But we could intrinsically feel that it would not last forever. So we found a great partner and sold our company. By the way, Marty Wolf, our firm’s founder, handled the deal. Two things to note: first, the company we sold would no longer have a premium value today. It’s ancient history. Second, it was at that time that I lived what we often say here at the firm: ”if you snooze, you lose.” A key to knowing “how long this will last” is understanding the lifecycle of technologies over time. It often depends on the role that early adopters (visionaries) play in acceptance and widespread proliferation. A great benchmark is the classic Law of Diffusion Innovation model first introduced by Everett Rogers, pictured below. Rogers’ “Diffusion of Innovations” theory seeks to explain how, why and at what rate new ideas and technology spread through cultures.

Law of Diffusion Innovation 50

Software as a Service

Innovators 2.5% (enthusiasts)

Early Adopters 13.5% (Visionaries)

Market Share

25

Personal Computers

Early Majority 34% (Pragmatists)

Late Majority 34% (Conservatists)

Laggards 16% (Skeptics)

0

Simply put, if there is a more compressed (shorter) adoption by user 2012 2017 2022 2025 ??? 2001 time segmented as innovators, early adopters, early groups over (ASP Model)

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majority, late majority and laggards — the faster a product, service or idea will reach market saturation. It is critical that we look at this adoption curve now in the Cloud Computing space — especially in the Software as a Service (SaaS) sector — which is barely past the stage of early adoption. A proof point is that Gartner Research predicts SaaS sales to accelerate from $12 billion (USD) in 2011 to nearly $21 billion in 2015. And more than 60 percent of this penetration is in North America — which leaves unparalleled opportunity in Asia/Pacific and Western Europe. The Early Adopters of SaaS (see chart) today represent less than 15 percent of the total addressable market. These individuals and organizations have the highest degree of opinion leadership among the other adopter categories. They are typically younger in age, have a higher social status, advanced education, and are more socially forward than late adopters. They are more discrete in adoption choices than innovators. The SaaS model has gained additional momentum in the marketplace due to Early Adopters who typically have greater access to mass media, are more inquisitive, have greater exposure to change agents and are more innovative. The Early Majority will adopt an innovation after a varying degree of time, which is dramatically longer that the innovators and early adopters. They represent, however, more than twice the market size of the two adoption stages preceding it combined. As Asia/Pacific accelerates its adoption of the SaaS platform, which by 2015 should tally SaaS revenue of more than $2 billion, growth opportunities will grow exponentially. For the SaaS marketplace, the increasing use of web-based user interfaces, higher penetration of broadband Internet access, and enhanced security has allowed the Early Majority to begin contemplating a shift to the Cloud. We believe the Early Majority will begin fully embrace various Software as a Service model during the next 5-7 years. The Late Majority, which only now supports PCs in their homes, is conservative by nature. These individuals and organizations approach innovations with a high degree of skepticism after the majority of society has adopted the innovation. Late Majority adopters are typically skeptical about an innovation and are probably more than 5-7 years away from embracing cloud technologies. The Laggards are the last to adopt an innovation. Unlike some of the previous categories, individuals in this category show little to no 16


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opinion leadership. These individuals typically have an aversion to change-agents and tend to be advanced in age. Laggards typically tend to be focused on "traditions," be oldest of all other adopters, in contact with only family and close friends. In most cases products finally adopted by the Laggards are typically going through obsolescence and are being phased out of production or being cannibalized by newer technologies. So back to the original question: “How long will this (SaaS) last?” In American baseball-speak, SaaS is only in the second inning of a nineinning game. It will continue to penetrate secondary markets and dilute the 60 percent adoption rate currently boasted in North America. But we also see continued growth in areas such as Database as a Service, Hardware as a Service and IT as a Service, with Google, Amazon, Apple and others playing a significant role. Finally, you can look at the fact that Oracle, a major IT player, just made a major public commitment to SaaS with Oracle Solaris at Oracle OpenWorld in October — it is a bellwether, so we expect continued growth and segmentation over the next five years. And in the short-term, hold on to your coattails. SaaS is just taking off — ask the early adopters.

__________________________________ Taking the Right Steps toward Creating Value! By Geoff Rhizor Senior Associate

One of the most basic questions every management team faces is, “How do I create value for shareholders (including the executives and other employees of a company)?” There are numerous ways to create value, but I am going to focus on five that are most relevant for middle market IT firms: leadership, intellectual property, mergers & acquisitions, partnerships and markets with room to grow. Leadership Sometimes the very best entrepreneurs are the very worst people to run a company once it hits a certain size, be it 100, 1,000 or 5,000 employees. That’s why it’s important for founder CEOs to be honest with themselves about their strengths and weaknesses, and recognize when they may have hit their “leadership ceiling.” Once they hit this ceiling, they should step away from day-to-day management into a 17


Valuation & Deal Insights

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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

non-Executive Chairman or similar role — or run the risk of destroying the value of their company. Another important leadership issue is that a company with 100 or 1,000 employees needs a different leadership structure than a company with 10. Fast and efficient growth requires a management team and organizational structure than can support it. And while a CEO should always be cautious about hiring at that level, it’s equally important to recognize when the company needs more leadership. Finally, one way to expand opportunities in the marketplace is to bring on directors who have different expertise or experience or contacts in new areas. Directors can be extremely valuable assets to a company if the right people are brought in for the right reasons. You will only have so many board seats; fill them wisely. Intellectual Property In the current technology environment, patents and intellectual property (IP) are key components of enterprise value. Consistent questions we receive from buyers is what IP does a potential acquisition candidate have and how have they protected it. Companies such as Apple, Google and Microsoft spend billions of dollars to acquire IP and additional billions of dollars to protect it. Don’t underestimate the contribution that patenting and protecting the underlying assets of your firm can make to your value, when viewed through the lens of the right buyer. Mergers & Acquisitions If done right, mergers and acquisitions can add significant value to a company. Whether it is divesting a division that is a cost center or acquiring a parallel product or geography, a carefully constructed M&A strategy can substantially add to a company’s competitive positioning. Many of the companies we work with in the IT supply chain space, for example, are looking to diversify their core low margin business with more recurring revenue and are looking at IT Services, Managed Services, and Data Center assets to accomplish this. All of these spaces can create value by enhancing the multiple of revenue or profitability the company will sell for in the future. When considering an acquisition, make sure you consider the integration risk and liabilities that come along with the target. Many times, a very small acquisition is as much work if not more than a larger one. The “simple” small acquisition often isn’t. Also, don’t do an 18


Valuation & Deal Insights

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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

acquisition of a low value asset just because it is cheap: 1 + 1 can easily equal 1.5 or even 0.5, if you’re not careful. When you plan to do a deal, hire a banker. Don’t leave money on the table by trying to do things yourself. Partnerships One of the most cost-effective ways to expand your sales and marketing reach is to harness effective partnership agreements with other vendors or resellers. Many times they will have access to hundreds if not thousands of customers and can quickly start selling your product with minimal up front cost. Instead of hiring a sales team of 50 people you can come up with a profit sharing agreement and it is a true win-win. Partnerships are especially important in rapid growth markets such as SaaS and cloud computing sectors, which are in a true land grab race. Waiting to build a sales team could be extremely costly in the long term. Growth Markets This may seem like a simple point, but many companies miss it completely. A key contributor to the value of your company is choosing a market with headroom — large enough to give your company ample room to grow. If you have too narrow of a focus, your company will not be attractive to a potential investor/buyer in the future. It is important to have a niche but make sure it is as wide and deep as possible. There are numerous ways for a company to create value, but these five are surefire starting places. Not only will they create more opportunity for growth, they will ensure that you are attractive to the right types of buyers once you get there.

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Valuation & Deal Insights

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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

______________________________ Notes from a Dialogue on Cross-Border M&A By Gaurav Sharma Senior Vice President

Earlier this month, martinwolf hosted its first cross-border M&A conference for Indian IT companies in Bangalore, and in collaboration with partners Grant Thornton, HSBC and Khaitan & Co. The conference was dedicated to exploring how Indian IT firms can capture value through cross-border M&A. Marty Wolf gave the keynote address and all of the partners presented their views on the topic. Fifty-five top executives from Indian IT companies of all sizes were there, and all who attended not only learned from the various presentations but also offered insights into some of their most pressing concerns. In his introductory letter to this issue of Valuation and Deal Insights, Marty talked about some of the factors that have changed our view of the Indian market since we opened our Bangalore office earlier this year. I’d like to share some of the key takeaways from his keynote and other talks at the event. Go Big or Go Niche. Indian IT companies must grow or specialize their skills or risk becoming irrelevant to customers and vendors. The Indian IT industry is at an inflection point, and with growth in global IT services slowing, market participants must find new ways to reenergize their firm’s enterprise value. To put things in perspective, in the last 12 months Indian Tier 1 and Tier 2 IT companies’ EV/EBITDA valuations declined by 12% and 16%, respectively, despite posting healthy topline growth of 26% and 18%. To arrest this trend, Marty stressed the importance of Indian companies moving up the value chain and developing functional or industry specialization. For example, our analysis reveals that companies operating in the Managed Services space attract an EBITDA multiple of 15.6x, compared with 4.7x for a company with pure BPO (voice) operations. Also, companies serving a vertical niche — such as those providing healthcare IT services and financial IT services — command higher 20


Valuation & Deal Insights

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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

valuation premiums of 11.7x and 9.5x EV/EBITDA, respectively. This argument is all the more relevant for relatively smaller players who can’t compete with the Tier 1 Indian IT firms in terms of scale, global reach and access to capital. Size Matters Another important consideration while evaluating valuation differentials is scale. Our analysis reveals that offshore outsourcing firms with market caps less than $500 million are valued at 5.1x EBITDA whereas those with market caps greater than $500 million are valued much higher, at 10.8x EBITDA. Therefore, it becomes clear that having a differentiated offering and/or achieving scale are two very effective ways of maximizing value. The Rise of China During the Q&A session, Marty fielded several questions about the rise of the Chinese IT industry and its implications for its Indian counterpart. While it is true that China is still playing catch up with the India IT giants, and is behind India in both total number and total deal value of M&A transactions, it is also important to acknowledge that the domestic market in China for IT services is much bigger than India. This gives Chinese companies significant domestic growth opportunities. Since 2008, average revenue growth percentage for Chinese IT services companies has been 18%, whereas the same for their Indian counterparts has been 8% — a trend likely to continue for the next 3-5 years. This period of high domestic growth in China will help Chinese companies gain scale and compete with Indian companies on a global basis. In addition, Chinese IT companies are not as heavily dependent on crisis-ridden Europe for revenue as are Indian firms. Since 2008-11, percentage revenue generated from Europe for Tier 1 Indian IT firms fell by 4% CAGR, highlighting the need for diversification of its customer base. M&A in IT Panelists at the event were asked to explain the relevance of M&A in IT, since the reduction of the product development cycle in the last decade has allowed companies to grow organically. We believe that this change makes M&A even more important today, as companies need to grow much faster to stay ahead of competition. A case in point is Google, which follows a very aggressive acquisition strategy to stay sharp and ahead of its competitors. According to a recent article in the Verge, Google bought 25 companies in 2011 — 21


Valuation & Deal Insights

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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

an acquisition every two weeks. And if we take the number of firms acquired for patents and IP into account, the figure reaches an astronomical 79. Companies like Google use M&A as a strategic tool to complement and expand their in-house capabilities. We believe that Indian IT companies can follow its lead, along with those of similar companies like IBM and Oracle. All of these companies are entering 2013 with strong inorganic growth fuelled by the cloud computing buzz and meaningful cross-border M&As. The Rise of the Cloud There was a lot of curiosity in the audience about SaaS and cloudbased business models. Many questions were directed towards valuations and what constitutes the right multiple range. We believe that any SaaS-based firm with significant IP and existing subscription streams will be valued at a multiple of revenue. Conservative estimates are that for a SaaS vendor experiencing no growth in subscription (for both enterprise and SMB stream) EV/revenue multiples can range between 2.8x-3.2x, If a 5% growth in all subscription streams is factored in, the equivalent multiple is 8.0x. Going Forward In our view, Big Data analytics and SaaS will be the two hottest sectors in India in terms of cross-border M&A. India's National Association of Software and Services Companies (NASSCOM) forecasts that the Big Data business in India will be worth as much as $1.2 billion within three years — a six-fold increase from current levels. That would be double the growth rate it expects for Big Data worldwide: to $25 billion from $8.25 billion. We expect a healthy mix of outbound and inbound investments with many foreign players looking to take advantage of competitive pricing and talent arbitrage in India. Superior analytical skills, technical acumen and proven service delivery expertise are some of the factors that make India an attractive cross-border M&A destination in this space. We believe Indian companies are uniquely poised for growth through cross-border M&A by leveraging their strong balance sheet and long-term price competitiveness and M&A can bridge the gap between resources and capabilities. A word of caution about cross-border M&A: be smart and choose your investments wisely. Many cross-border deals fail.

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Valuation & Deal Insights

Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

Selected Transactions In an effort to keep you apprised of various transactions that we believe are significant to the marketplace, shareholders, and the M&A industry, we offer the following analysis. More information can be found on our website at www.martinwolf.com/mw-spotlight/. 1. IBM to Acquire Kenexa Corp (NYSE:KNXA) Target: Kenexa Corporation, along with its subsidiaries, provides Software as a Service (SaaS) solutions that focus on the Human Capital Management (HCM) space. These applications focus on the recruitment, retaining and development of employees, offering talent acquisition software, employee assessments and leadership solutions Buyer: International Business Machines Corporation (NYSE:IBM) proves IT products and services worldwide, operating in the Global Technology Services, Global Business Services, Software, Systems and Technology and Global Financing segments. Implied Enterprise Value: $1.2 billion, EV/LTM Revenue: 3.8x Synopsis: IBM announced that it would acquire Kenexa Corp. in a deal worth $46 per share of Kenexa, for a total of $1.26 billion in cash. Transaction Highlights: Kenexa has been growing rapidly both organically and inorganically, with seven previous deals in the past three years that added talent management capabilities in software, services and exchanges across multiple regions. This deal represents a significant move into the Human Capital Management (HCM) space, (particularly on the talent management side) for IBM, and follows major acquisitions in the space such as SAP's 2011 purchase of SuccessFactors, Inc. for $3.8 billion and Oracle's 2012 purchase of Taleo for $1.9 billion. This is another deal in a series of acquisitions for IBM, which acquired eight other companies in the first half of 2012 at a total cost of $2.2 billion. This deal emphasizes that the best buyer is the one that can do the most with your asset going forward - and while Kenexa has been struggling to make money on its own, it offers IBM new capabilities. martinwolf previously profiled Kenexa as one of the Top 20 Saas Companies of 2011, along with Convio, Inc., RightNow Technologies, Inc., DemandTec, Inc, SuccessFactors, Inc. and Taleo Corp., all of which have been acquired. 23


Valuation & Deal Insights

Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

2. hiSoft Technology International Ltd. To Acquire VanceInfo Technologies Inc. Target: VanceInfo Technologies Inc. (NYSE:VIT), along with its subsidiaries, engages in providing information technology (IT) consulting services, providing research and development services across various phases of development. It is headquartered in China. Buyer: HiSoft Technology International Limited (NasdaqGS:HSFT) provides outsourced IT and research and development services in Asia, North America and Europe. It serves technology and banking, financial services and insurance industries and is headquartered in China. ! Implied Enterprise Value: $438.65 million Synopsis: hiSoft Technology International Ltd. (NASDAQ: HSFT) signed an agreement on August 10th to acquire VanceInfo Technologies Inc. (NYSE:VIT) in a merger of equals for approximately $530 million in stock. Transaction Highlights: !! The combined company, with expected 2012 revenue of $670 million, will be the largest China-based offshore IT services provider by revenue according to the press release. Together, they will provide complementary services - VanceInfo offers software development and maintenance, while hiSoft focuses on technology outsourcing. The companies create an IT outsourcing powerhouse - effectively, a Chinese Infosys in the making. The two companies have a significant international sales footprint: hiSoft garners 77% of its revenue outside China, VanceInfo receives 52% of its revenue outside China (mainly Hong Kong and Macau). The combined companies will have better economies-of-scale, offsetting the current increasing wage and real estate prices in China. Its international footprint helps counterbalance lower revenue margins on domestic China sales. The new company will be better positioned to service the U.S. market, which still has the highest demand for outsourcing services.

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Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

3Q12

Select MW Transactions Below are selected transactions in which martinwolf served in an advisory capacity.

About martinwolf With offices in San Francisco and Bangalore, martinwolf is the world’s leading middle market IT M&A advisory. Since 1997, the firm has completed more than 115 transactions in six countries. Its knowledge and experience with IT outsourcing and managed services combined with its disciplined approach, which includes a proprietary, proven, step-by-step work plan customized for each client, has produced one of the highest transaction completion rates in the industry. The firm has active engagements in six countries and has completed transactions with six Fortune 500 companies. For more information, visit http://www.martinwolf.com. 2012 martinwolf LLC., All rights reserved. Securities through martinwolf LLC., Member FINRA, SIPC.

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Valuation & Deal Insights

Industry Coverage: IT Services, SaaS, BPO and IT Supply Chain Services

Products vs. Services Valuation Continuum

17%(Product/83%(Services( EV/Revenue:((2.98x(

95%(Product/5%(Services( EV/Revenue:((0.12x(

100%( Product(

Low(

0%(Product/100%(Services( EV/Revenue:((1.21x(

Product/Services(Mix(

100%( (Services(

Valua%on(

High(

65%(Product/35%(Services( EV/Revenue:((0.26x(

0%(Product/100%(Managed(Services( EV/Revenue:((7.75x(

Data as of October 2012 Source: Capital IQ

Appendix 26

1


Transaction Comparables Transaction Multiples

($ in millions) Announce Date

Target

Acquirer

Acquisition type

Target Description

01/31/2005

OneNeck IT Services Corporation

WestView Capital Partners

PE recap

Application hosting management, data center solutions

07/14/2009

Peak 10, Inc.

McCarthy Capital

PE recap

12/21/2009

VaultLogix, LLC

WestView Capital Partners; London Bay Capital LLC; WestView Capital Partners II, L.P.

02/04/2010

Layered Technologies

08/03/2010

Transaction Value

Enterprise Value

EV/Rev

EV/EBITDA

95.0

95.0

2.57x

NA

Data center operator

NA

NA

NA

NA

PE recap

Online back-up and restoration services

NA

NA

NA

NA

Accel-KKR

PE recap

Managed hosting solutions

NA

NA

NA

NA

SoftLayer Technologies, Inc.

GI Partners

PE recap

Data center operator

NA

NA

NA

NA

09/01/2010

Peak 10, Inc.

Welsh, Carson, Anderson & Stowe

PE recap

Data center operator

NA

NA

NA

NA

10/29/2010

Venyu Solutions Inc.

Gladstone Investment Corporation; Madison Parker Capital,

PE recap

Data center and managed services

64.0

64.0

0.14x

NA

05/10/2011

Datapipe, Inc.

ABRY Partners, LLC

PE recap

Data center services

176.0

176.0

NA

NA

06/16/2011

Xand Corporation

ABRY Partners, LLC

PE recap

Data center provider in Northeast

49.0

49.0

NA

NA

06/20/2011

iWeb Group Inc.

Novacap

PE recap

Hosting services

64.5

63.0

2.10x

10.50x

06/30/2011

GoDaddy.com

Kohlberg Kravis Roberts & Co. (NYSE:KKR); Silver Lake Partners; Technology Crossover Ventures

PE recap

Web hosting services and domain name registrar

2,250.0

2,250.0

2.36x

NA

07/12/2012

Velocity Technology Solutions, Inc.

Silver Lake Partners; Partners Group Holding AG; Silver Lake Sumeru, L.P.; Northleaf Capital Partners

PE recap

Application hosting management, data center solutions

NA

NA

NA

NA

08/01/2012

TekLinks, Inc.

Pamlico Capital

PE recap

Technology solutions and data center services

NA

NA

NA

NA

05/19/2009

Hosting.com

HostmySite, Inc. (nka Hosting.com)

PE driven acquisition

Web hosting and technical support

NA

NA

NA

NA

09/01/2009

ServerVault Corp.

Carpathia Hosting, Inc.

PE driven acquisition

IT infrastructure management and hosting services

NA

NA

NA

NA

Appendix 27


Transaction Comparables Transaction Multiples

($ in millions) Announce Date

Target

Acquirer

Acquisition type

Target Description

Transaction Value

Enterprise Value

EV/Rev

EV/EBITDA

12/22/2009

1vault Networks, LLC (nka:Peak 10 South Peak 10, Inc. Florida)

PE driven acquisition

Data center operator

NA

NA

NA

NA

11/08/2010

ThePlanet.com Internet Services, Inc.

SoftLayer Technologies, Inc.

PE driven acquisition

Data center operator

475.0

475.0

NA

NA

05/28/2011

Agilysys Europe Technology Solutions And Agilysys Canada And Agilysys Technology Solutions Group

OnX Enterprise Solutions Ltd.

PE driven acquisition

Technology solutions and data back up services

NA

NA

NA

NA

09/28/2011

Utility Backup Solutions, LLC

VaultLogix, LLC

PE driven acquisition

Online back-up and restoration services

NA

NA

NA

NA

10/06/2011

NeoSpire, Inc.

Hosting.com, Inc.

PE driven acquisition

Managed hosting solutions

NA

NA

NA

NA

02/24/2012

digital.forest, Inc. and Mzima, LLC

Digital Fortress, Inc.

PE driven acquisition

Regional colocation services provider

182.0

182.0

3.79x

NA

04/03/2012

Access Northeast, Inc.

Xand Corporation

PE driven acquisition

Data center provider in Northeast

NA

NA

NA

NA

04/09/2012

Datapreserve, Inc.

VaultLogix, LLC

PE driven acquisition

Online back-up and restoration services

NA

NA

NA

NA

07/31/2012

Data based Systems Intl

Xand Corporation

PE driven acquisition

Data center provider in Northeast

NA

NA

NA

NA

01/27/2011

Terramark Worldwide, Inc.

Verizon Communications, Inc.

Telco entering into IaaS

Managed cloud infrastructure solutions provider

1,910.6

1,841.8

5.40x

22.40x

02/01/2011

Navisite, Inc.

Time Warner Cable

Telco entering into IaaS

Managed cloud and enterprise hosting service

331.8

326.8

2.50x

12.30x

06/28/2011

OneNeck IT Services Corporation

TDS Hosted & Managed Services, LLC

Telco entering into IaaS

Application hosting management, data center solutions

NA

NA

NA

NA

11/04/2011

Hosted Solutions LLC

Windstream Communications

Telco entering into IaaS

Hosting services

310.0

310.0

6.00x

NA

12/16/2010

Cloudkick, Inc.

Rackspace US, Inc.

Public Company driven acquisition

Cloud monitoring and management tools

NA

NA

NA

NA

02/10/2011

Anso Labs, LLC

Rackspace Hosting, Inc.

Public Company driven acquisition

An elastic cloud partisioning software developed for NASA

NA

NA

NA

NA

01/03/2012

Voxel.Net

Internap Network Services Corp

Public Company driven acquisition

Hosting services

33.3

32.3

NA

NA

Appendix 28


Transaction Comparables Transaction Multiples

($ in millions) Announce Date

Target

Acquirer

Acquisition type

Transaction Value

Target Description

06/06/2012

netBenefits Ltd

Peer 1 Network Enterprises, Inc.

Public Company driven acquisition

managed webhosting services for businesses in UK

08/22/2012

Mailgun, Inc.

Rackspace Hosting, Inc.

Public Company driven acquisition

Mailgun is an email management SaaS for ISVs

01/06/2011

All Covered, Inc.

Konica Minolta Business Solutions, U.S.A., Inc.

Solution provider entering into IaaS

IT consulting and cloud solutions to SMB

11/01/2011

INX Inc.

Presidio Networked Solutions, Inc.

Solution provider entering into IaaS

12/28/2011

mindSHIFT Technologies, Inc.

Best Buy Co. Inc.

02/28/2012

Total Convergence Solutions LLC

Presidio Networked Solutions, Inc.

06/19/2012

Whilte Glove Technologies, LLC

mindSHIFT Technologies, Inc. / Best Solution provider Buy Co. Inc. entering into IaaS

06/17/2010

Register.com, Inc.

Web.com Group, Inc.

One Stop Shop for SMB

08/03/2011

Network Solutions, LLC

Web.com Group, Inc.

07/18/2012

Outright, Inc.

GoDaddy, Inc.

Enterprise Value

EV/Rev

EV/EBITDA

38.7

38.7

NA

NA

NA

NA

NA

NA

Network Infrastructure, Unified Communications and Collaboration (UC&C), and Data Center solutions

155.2

148.1

0.4x

49.0x

Solution provider entering into IaaS

IT infrastructure services for SMB

175.0

168.0

NA

NA

Solution provider entering into IaaS

IT infrastructure and unified communications solutions

NA

NA

NA

NA

Managed IT services for SMB

NA

NA

NA

NA

Domain name registrar

793.7

793.7

NA

8.82x

One Stop Shop for SMB

Domain name registrar

NA

NA

NA

NA

One Stop Shop for SMB

Accounting software as a service for small businesses

NA

NA

NA

NA

Median Average

175.5 444.0

172.0 438.3

2.5x 3.1x

11.4x 13.5x

High Low

2,250.0 33.3

2,250.0 32.3

6.0x 0.1x

22.4x 8.8x

Appendix 29

MW VDI 3Q12  

The MW Valuation and Deal Insights® is a quarterly newsletter that tracks M&A activities in the following industries: IT, IT-EnabledOutsourc...

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